How should an employer select which employees to make redundant? Unless a unique role is being removed from the business structure there needs to be a criteria in place to choose the unlucky people to be sent to the departure lounge.
Ideally that selection criteria should be objective and non-discriminatory as possible, although previous case law (Mitchells of Lancaster (Brewers)Ltd v Tattersall) has held that using non-objective criteria is not fatal to a redundancy selection exercise, provided the criteria is used fairly. However, problems can arise where the criteria itself is not in dispute.
For instance in the case of Nicholls v Rockwell Automation Ltd it was held the an ET should not have held that the employee’s dismissal was unfair because it thought some of the scores applied by the employer were too harsh or as it was held “(certain scores) were clearly lower than they should have been”.
The employer successfully appealed to the EAT which took the view that the ET was wrong to engage in a detailed analysis of the scores when considering whether it was reasonable to dismiss the Employee and, further, the ET had substituted its own views for that of the employer.
In this instance there was no suggestion that the employer had bad motives. If there had been, one can surmise, then it will be necessary for the ET to conduct a careful examination of the scoring exercise.
This is an interesting issue for me because we advise many employees who have been placed at risk of redundancy and, usually, their concerns about their selection fall into two categories;
(a) Is there a redundancy situation, or
(b) Why me?
Whether there is a redundancy situation is a fraught issue, but so is (b). The current state of case law following Nicholls and Mitchells of Lancaster seems to be that employers don’t necessarily have to use objective criteria and ETs won’t get involved in how an employee was scored against that criteria unless there is evidence to suggest that the employer was not acting in good faith. That will be a steep hill for most employees to climb because in the absence of any obvious unfairness it will be difficult to persuade an ET that “bad motives” were at work.
[...] There is a reminder about the need to follow the correct redundancy procedures, if the employer has one. If not, there is still a duty to inform and consult with employees. The selection criteria to be used must be fair and objective and, in larger companies, should be agreed with employee representatives. ACAS gives examples of possible criteria, such as disciplinary records, skills or experience, standard of work performance and aptitude for work. Selection criteria do not have to be objective (and it is very hard to keep any sort of subjective analysis out of the selection process anyway), but what is important is that the criteria is applied fairly. [...]